BUENOS AIRES (Reuters) – Brazil and Argentina are aiming for greater economic integration, including the development of a common currency, Brazilian President Luis Inacio Lula da Silva and Argentinian President Alberto Fernandez said. In an article I co-wrote.
“We intend to overcome exchange barriers, simplify and modernize rules, and encourage the use of local currencies,” the text posted on the Argentinian website Perfil said.
“We also decided to advance discussions on a common South American currency that could be used for both financial and commercial flows, reducing costs and external vulnerabilities,” the article said.
The idea of a common currency was originally raised in an article written last year by Fernando Haddad and Gabriel Garipolo (now Brazil’s Finance Minister and his Executive Director, respectively), and was mentioned by Lula during the campaign.
Lula chose Argentina for her first trip abroad since taking office. It follows the tradition of being the first to visit Brazil’s largest trading partner in the region. This follows a tense four-year tenure under former Brazilian right-wing President Jair Bolsonaro.
Lula’s visit to neighboring Argentina marks Brazil’s return to the Community of Latin American and Caribbean States (CELAC), which Brazil left in 2019 on orders from Bolsonaro, who refused to join the regional group because of the presence of Cuba and Venezuela. also means
According to the article, both presidents stressed the need for good relations between Argentina and Brazil to strengthen regional integration.
Leaders also stressed strengthening the Mercosur trading bloc, which includes Argentina, Brazil, Paraguay and Uruguay, and Brazilian Finance Minister Haddad recently lamented its abandonment in recent years.
“With our partners, we hope that Mercosur will form a platform for effective integration into the world through the joint negotiation of a balanced trade agreement that addresses our strategic development goals,” the presidents said. ‘ said.
In the early hours of the same day, the Financial Times report Neighboring countries will announce this week that they will begin preparatory work for a common currency.
The plan, which will be discussed at a summit in Buenos Aires this week, will show how the new currency, which Brazil proposes to call “Sur” (Southern), will facilitate regional trade and reduce reliance on the US dollar. , the FT reported, citing officials. .
Politicians from both countries were already discussing the idea in 2019, but it was met with backlash from the Central Bank of Brazil at the time.
Initially launched as a bilateral project, the initiative would later be expanded to invite other Latin American countries, the report said, with an official announcement expected during Lula’s visit to Argentina beginning Sunday evening. He added that he had.
Reported by Lisandra Paraguassu. Additional reporting by Jyoti Narayan of Bengaluru. Edited by Tomasz Janowski, Diane Craft, Chris Reese
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